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BUCKEYE, AZ-A limited liability company formed by Chicago-based First Industrial Realty Trust Inc. has paid $10.5 million to purchase 160 acres at the northwest corner of Van Buren Street and Perryville Road. The seller, Phoenix-based Courtland Properties LLC, had planned to use the site for residential development, but the city's decision to change the area's preferred use in its new general plan prompted it to sell.
George Quintif, president of Peak Group LLC in Phoenix, represented First Industrial in the transaction. He says the company acquired the site for $2 million less than the $12.5-million ask because it had the resources to quickly close the deal.
"The seller wanted to close before the end of the year," Quintif tells GlobeSt.com. "I tried to buy it myself earlier in the year. We had a group together that was going to buy it, but we couldn't put a deal together. There were a couple other parties interested this time around, but Courtland went with First Industrial because they were sure they could close."
Quintif says the city decided to alter the general plan in response to the planned construction of an Interstate 10 interchange about half a mile from the site. In addition, the acreage lies beneath the flight path for Luke Air Force Base and a recent state law bans most new residential development in fly-over zones.
Although the Courtland project is technically exempt from the law because the company purchased the site prior to enactment, Quintif says it would have faced a lot of pressure not to build.
According to Robert Hubbard, development manager for First Industrial in Phoenix, there is no specific plan for the site, but they will be working with the city to devise a scheme that fits the new general plan. He says the tract will be able to support more than two million sf of buildings, with about 75% of the property designated for industrial and business park development and 25% for commercial and retail. Work is expected to begin in 2010.
The land acquisition is First Industrial's second on the west side of Phoenix this year. In April, the developer paid just over $21.1 million for a 149-acre parcel at 75th Avenue and Buckeye Road. That site is targeted for about two million sf of industrial, flex, showroom and retail buildings. Kent Xander of KAX Group in Scottsdale represented Courtland in the transaction.
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